A Brief History of New A Brief History of New Zealand’s National Asset Zealand’s National Asset

Management Steering Management Steering CommitteeCommittee

Anthony WilsonAnthony Wilson

General Manager Community AssetsGeneral Manager Community Assets

BackgroundBackground NZ is a sovereign nation with a NZ is a sovereign nation with a

‘Westminster’ style parliament.‘Westminster’ style parliament. 2 tiers of government – central and local2 tiers of government – central and local Local Government is a creature of statuteLocal Government is a creature of statute Water Supply, Sewerage, Flood Control and Water Supply, Sewerage, Flood Control and

Stormwater are the responsibility of local Stormwater are the responsibility of local government (with some exceptions)government (with some exceptions)

Size of local government units varies Size of local government units varies hugely: 500,000 popn to 1,800 popn.hugely: 500,000 popn to 1,800 popn.

National population 4,000,000.National population 4,000,000.

1989 Reform1989 Reform

Units of local government significantly Units of local government significantly reducedreduced

Local Govt required to be demonstrably Local Govt required to be demonstrably ‘efficient’ and ‘effective’.‘efficient’ and ‘effective’.

Moved from Cash Book to Accrual Moved from Cash Book to Accrual accountingaccounting

Specifically Local Govt had to:Specifically Local Govt had to:

Establish clear objectives for each activity Establish clear objectives for each activity and measure its performance in relation to and measure its performance in relation to these objectivesthese objectives

Annually report to the public on stated Annually report to the public on stated targets and performancetargets and performance

Establish a fair valuation of the existing Establish a fair valuation of the existing assets and make financial provision for assets and make financial provision for maintaining and replacing the assets.maintaining and replacing the assets.

All 74 Councils had the same All 74 Councils had the same problem:problem:

Up to 140 years of asset creation Up to 140 years of asset creation Poor recordsPoor records No values for existing assetsNo values for existing assets Uncertainty on performanceUncertainty on performance Uncertainty on conditionUncertainty on condition Uncertainty of maintenance historyUncertainty of maintenance history Uncertainty on service livesUncertainty on service lives

Clearly if a co-operative solution could be Clearly if a co-operative solution could be found it would benefit allfound it would benefit all

Some models of commonality and co-Some models of commonality and co-operation existedoperation existed

All Councils used RAMM (Roading Asset All Councils used RAMM (Roading Asset Maintenance Management)Maintenance Management)

Water Supply and Drainage Managers (Sub Water Supply and Drainage Managers (Sub groups of NZWWA) had ‘project fund’ for groups of NZWWA) had ‘project fund’ for common need projectscommon need projects

Examples:Examples:

Model Bylaws (Ordinances)Model Bylaws (Ordinances)– Trade WasteTrade Waste– Water Supply Conditions of SupplyWater Supply Conditions of Supply

Standard specification for chemicals for Standard specification for chemicals for water treatmentwater treatment

Model public information resource packs Model public information resource packs for water conservationfor water conservation

PAMS ProjectPAMS Project Pipeline Asset Management Pipeline Asset Management

SoftwareSoftware Water & Drainage Engineers recognised Water & Drainage Engineers recognised

complexity of asset base needed a digital complexity of asset base needed a digital solutionsolution

7 leaders of the industry (from big, medium 7 leaders of the industry (from big, medium and small Councils) were invited to a and small Councils) were invited to a meeting in December 1993.meeting in December 1993.

Individuals were selected for their Individuals were selected for their individual drive not the ‘status’ of their individual drive not the ‘status’ of their organisation.organisation.

Objectives Agreed:Objectives Agreed:

Select a software product that would be suitable to Select a software product that would be suitable to both largest and smallestboth largest and smallest

30 of 74 Councils take up seen as ‘critical mass’ to 30 of 74 Councils take up seen as ‘critical mass’ to be regarded as ‘national’ system.be regarded as ‘national’ system.

Good products did exist internationallyGood products did exist internationally Any system may need customisation for NZ (e.g. Any system may need customisation for NZ (e.g.

metrication)metrication) Needed a probity auditor for selection processNeeded a probity auditor for selection process All Councils should be encouraged to contribute All Councils should be encouraged to contribute

as all stood to benefitas all stood to benefit

Project needed to be managed by small team but Project needed to be managed by small team but all contributors needed to be kept routinely all contributors needed to be kept routinely informedinformed

Selected system needed to be flexible for single Selected system needed to be flexible for single PC site to multi-user environmentPC site to multi-user environment

Dynamic integration needed to GIS, financial, Dynamic integration needed to GIS, financial, property and customer systemsproperty and customer systems

Reporting from the system must be simple flexible Reporting from the system must be simple flexible and user friendlyand user friendly

Project provided basis for national database and Project provided basis for national database and benchmarkingbenchmarking

Needed to recognise NZ’s outsourcing Needed to recognise NZ’s outsourcing environment environment

Municipal Engineers Association (ALGENZ now Municipal Engineers Association (ALGENZ now INGENIUM asked to ‘sponsor’ projectINGENIUM asked to ‘sponsor’ project

Project cost $120,000Project cost $120,000 Included:Included:

– International literature review International literature review – Workshops to determine user requirementsWorkshops to determine user requirements– Detailed specificationDetailed specification– Peer reviewPeer review– International registrations of interestInternational registrations of interest– Standard contract documentsStandard contract documents– Customisation of selected productCustomisation of selected product– Acceptance testingAcceptance testing– National roadshow to market productNational roadshow to market product

Cost to individual councils:Cost to individual councils:

Project Cost $120,000Project Cost $120,000 Largest CouncilsLargest Councils $2,000$2,000 Medium Councils Medium Councils $1,000$1,000 Small Councils Small Councils $500$500

In the end all but 2 of 74 Councils In the end all but 2 of 74 Councils contributed to the projectcontributed to the project

Next projectsNext projectsA number of different organisations started to A number of different organisations started to

develop complementary projects:develop complementary projects: Standardised Data DictionaryStandardised Data Dictionary Asset Numbering GuidelinesAsset Numbering Guidelines Condition Assessment GuidelinesCondition Assessment Guidelines Performance Assessment GuidelinesPerformance Assessment Guidelines CCTV Inspection Grading StandardsCCTV Inspection Grading Standards National AC condition data collectionNational AC condition data collection

Need for National Co-ordination Need for National Co-ordination recognised - multi entity committee recognised - multi entity committee

formedformed INGENIUM (municipal engineers)INGENIUM (municipal engineers) New Zealand Water and Wastes Assn New Zealand Water and Wastes Assn

(equivalent to WEF and AWWA)(equivalent to WEF and AWWA) Society of Local Government Managers Society of Local Government Managers

(accountants and administrators)(accountants and administrators) Local Government New Zealand (elected Local Government New Zealand (elected

representatives organisation)representatives organisation) Officer of Controller and Auditor-General Officer of Controller and Auditor-General

(Officer of Parliament)(Officer of Parliament)

NAMS ProjectsNAMS Projects PRAMS PRAMS Parks &Parks & Recreation Asset Recreation Asset

Management SoftwareManagement Software National Asset Management Manual (based National Asset Management Manual (based

on Australian version. Now International on Australian version. Now International Infrastructure Management Manual)Infrastructure Management Manual)

Asset Valuation and Depreciation Asset Valuation and Depreciation GuidelinesGuidelines

Guidelines for Agreeing and Monitoring Guidelines for Agreeing and Monitoring Service Levels with CustomersService Levels with Customers

Optimised Decision Making GuidelinesOptimised Decision Making Guidelines ‘‘Tips for the New Car Owner’ – An elected Tips for the New Car Owner’ – An elected

representatives guide to Asset Managementrepresentatives guide to Asset Management RAMM enhancementRAMM enhancement Standard reportingStandard reporting On going training programmeOn going training programme

– Sessions pitched at newcomer, intermediate and Sessions pitched at newcomer, intermediate and advanced levelsadvanced levels

– National roadshowsNational roadshows– Customised to suit topical issues (legislation Customised to suit topical issues (legislation

change etc.)change etc.)

Why was and has NAMS been Why was and has NAMS been successful?successful?

It was timely – everyone had a urgent need driven It was timely – everyone had a urgent need driven by legislation change.by legislation change.

We picked the right movers and shakers – We picked the right movers and shakers – individuals not organisations individuals not organisations

It delivered unquestionably value for money -It delivered unquestionably value for money -tangible outcomes not just theorytangible outcomes not just theory

Financial contributions were project not Financial contributions were project not subscription based.subscription based.

Costs were set to be affordable for small entities.Costs were set to be affordable for small entities. We didn’t try and reinvent the wheel, we picked We didn’t try and reinvent the wheel, we picked

good international examples and improved them.good international examples and improved them.

Communications was good and targeted at right Communications was good and targeted at right people within organisations often at two or more people within organisations often at two or more levels in same organisationlevels in same organisation

Individual enthusiasts were encouraged to develop Individual enthusiasts were encouraged to develop national expertise and status (e.g. asset numbering national expertise and status (e.g. asset numbering and asbestos cement pipes)and asbestos cement pipes)

Training became the cash cow which provided Training became the cash cow which provided seed capital to provide critical massseed capital to provide critical mass

We successfully engaged both local and national We successfully engaged both local and national politicians politicians

National roadshowsNational roadshows

We had some champions in consultancies who We had some champions in consultancies who identified projects and approached NAMS to identified projects and approached NAMS to progress themprogress them

A number of different individuals, organisations A number of different individuals, organisations and disciplines became ‘evangelists’: accountants, and disciplines became ‘evangelists’: accountants, engineers, administrators, elected representatives, engineers, administrators, elected representatives, auditors. NAMS provided a forum fro them.auditors. NAMS provided a forum fro them.

Special Interest groups were encouraged to ‘do Special Interest groups were encouraged to ‘do their own thing’ within a loose framework. (e.g their own thing’ within a loose framework. (e.g software User Groups)software User Groups)

By having the Auditor-General ‘inside the house’ By having the Auditor-General ‘inside the house’ we jointly developed the rules. This has lead to we jointly developed the rules. This has lead to ongoing legislation change being strongly ongoing legislation change being strongly influenced by the practitionersinfluenced by the practitioners

What could we have done better in What could we have done better in hindsight?hindsight?

We had a software solution but almost no data to We had a software solution but almost no data to use in it!use in it!

We raised some expectations too highWe raised some expectations too high Maintaining the drive and consistency is Maintaining the drive and consistency is

challenging. These projects take years and people challenging. These projects take years and people move both within and out of the industrymove both within and out of the industry

Some projects, notably the CCTV manual are Some projects, notably the CCTV manual are overdue for updates. overdue for updates.

Medium sized entities appear to manage change Medium sized entities appear to manage change better than small or very large ones.better than small or very large ones.

Don’t worry about freeloaders “Imitation is the Don’t worry about freeloaders “Imitation is the greatest form of flattery”greatest form of flattery”

NAMS todayNAMS today Industry based public and private sector interest Industry based public and private sector interest

representationrepresentation Fulltime CEOFulltime CEO Mechanical Engineer with sales backgroundMechanical Engineer with sales background Funded by products and services not subscriptionsFunded by products and services not subscriptions Has relationships with similar organisations in Has relationships with similar organisations in

Australia, Canada and South Africa.Australia, Canada and South Africa. Has marketing agreements with APWA, FHWA & Has marketing agreements with APWA, FHWA &

AASHTO in USA (non exclusive)AASHTO in USA (non exclusive) 2005 version of IIMM will have USA specific 2005 version of IIMM will have USA specific

section and USA case studies (Sep/Oct 05)section and USA case studies (Sep/Oct 05) Keen to develop new relationshipsKeen to develop new relationships

www.nams.org.nzwww.nams.org.nz

+64 7 868 3930+64 7 868 3930